The World Jewish Congress has criticized Greece's delay in adopting tougher anti-racism legislation aimed at curbing neo-Nazi party Golden Dawn, owing to disagreement within the Greek government coalition.

"It is very worrying that the mainstream parties in Athens are apparently unable to find a compromise on this important matter," WJC president Ronald Lauder said in a statement late on Tuesday.

"Hate mongers and extremists such as the leaders of Golden Dawn are not only a threat to minorities such as the Jews; they are a threat to democracy as a whole. Hence, they ought to be fought vigorously by all democratic forces, and with the full force of the law," Lauder said, according to the AFP news agency.

The WJC represents Jewish communities outside Israel.

The proposed bill would impose prison sentences of up to three years and a fine of up to 20,000 euros for hate speech and the denial or praise of war crimes and genocide.

Prime Minister Antonis Samaras' New Democracy party had initially backed the bill, which was crafted to curb the neo-Nazi Golden Dawn party.

But his party, the ruling coalition's biggest component, has since backtracked to avoid alienating its base of supporters who include members of the influential Orthodox Church and the army, critics claimed.

New Democracy now says the proposed legislation goes too far in limiting freedom of expression.

The other coalition partners, the socialist and moderate leftist parties, have pledged to table the bill on their own and call for as much parliamentary support as they can muster.

Current law imposes a maximum jail term of two years for hate speech.

Golden Dawn, which espouses an anti-Semitic and xenophobic ideology, has 18 lawmakers in parliament and currently polls at around 10 percent in opinion surveys. Rights groups believe that it has instigated a recent wave of violence against migrants, which the party denies.

On Monday, Golden Dawn leader Nikos Michaloliakos said the group could operate "outside the law" if necessary.